Whether you fell prey to the guys handing out credit cards like candy on campus, got carried away on one too many shopping sprees or got hit hard by the recent economic downturn, you’ve probably damaged your credit. The good news is that there are some things that you can do to repair your credit.
Financing a home can be made more difficult when your credit score is low.If your income is a factor you may qualify for a FHA loan, try to get a FHA loan because there is a guarantee that it will be given to you. FHA loans are ideal for those who cannot afford the high down payments and help with closing costs.
If you have credit cards with a utilization level over 50%, you should pay it down to below 50%.
You may be able to reduce interest rates by working to keep your credit rating. This will make your payments easier and allow you to pay off your debt a lot quicker.
Credit Score
You can easily get a house and finance it if you have a high credit score. Making mortgage payments in a timely manner helps raise your credit score.This will also be useful in the event that you need to borrow money.
You can lower your debt by refusing to acknowledge the part of your debt that has been accrued by significantly high interest rates if you are being charged more than you should be. Creditors are skirting a fine line of the law when they try to charge you exorbitant interest rates. You did however sign a contract and agree to pay interest. You may wish to make a legal claim that the interest rates are too high if you want to sue your lenders.
You should always make an effort to pay them on time and in full. Your FICO score will increase if you are past due.
Be wary of programs that can get you in legal trouble.There are less than honest entities that teach you how to create a brand new credit file. Do not attempt this because it’s illegal; you into big trouble with the law. You could end up owing a great deal of money or even facing jail if you are not careful.
Contact your creditors to request a reduction in your overall credit line. Not only will this prevent you from owing more, but it can also imply that you are responsible to those companies and to any future companies.
Dispute every error you find on any of your credit report.
If you work out a payment plan with a creditor, make sure the agreement is committed to paper. Once the debt is fully paid, get a statement that verifies that the debt has been satisfied and send it to the various credit reporting agencies.
Bankruptcy should only be viewed as a last resort. This will show up on your credit report for the next 10 years. It might seem like a good thing but in the line.
Pay off any balances as soon as you can to start the credit score repair process. Pay down your cards that have the highest interest rates first. This helps creditors you are responsible about your credit cards.
Take the time to carefully go over your credit card statements. It is only your responsibility to be sure that everything is correct.
The most it will only draw further attention to the bad aspects of the report.
Prepaid credit cards can help to rebuild your score without late payments or going over your limit. Doing this shows lenders that you are a responsible person.
Credit Score
Opening too many lines of credit negatively affect your credit score.When you are at the checkout, politely reject the offer. As soon as you open your new credit card, your credit score drops immediately.
Be aware that threats made by a bill collector threatens you; this is not legal. You need to know what the laws that protect your rights as a consumer.
If you are having trouble creating or maintaining a budget, call a credit counseling organization. These organizations can help you build a repayment plan that works for your financial situation. Credit counseling can be a key piece in helping you learn how to budget your salary and pay your obligations.
Talk to creditors directly if you cannot afford your monthly payments.
Creditors take note of your income and they compare it to your total debt. You will be seen as a bad credit risk if your debt is too high in comparison with your income. You don’t have to pay it all at once, so you should make a plan to repay in a timely fashion and follow that schedule.
Look at your credit report to make sure that the discrepancies are valid. There could be a mistake or error in error.If you can prove that a given discrepancy is invalid, you should submit a credit dispute to the institution that gave you a bad mark on your report.
Paying everything on time is paramount in credit improvement. Even if you can only pay the minimum payment, you need to pay something. Even one missed or late payment will hurt your credit.
It can be stressful to try and figure out how to improve your credit, but if you keep at it, you can make things better and see the results you want. With the tips above, you are better prepared to take action and get your credit situation back where it should be.
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